The signing of new foreign currency-based retail mortgage loans by Hungarian banks came to a practical halt in July as the result of a government ban on such borrowing, fresh data published by the National Bank of Hungary (NBH) on Tuesday show.
The government decided to ban the loans because of foreign exchange rate risks to borrowers at the very end of June, thus the foreign currency-based loans that were signed in July had probably reached the negotiating stage in June. Although legislation enforcing the ban was not signed until early August, Hungary’s biggest banks said they would voluntarily comply from the start of July.
The value of new euro-based home loans banks signed with retail clients in July fell to HUF 1.5bn from HUF 4.2bn in June and HUF 15.7bn twelve months earlier. The value of new euro-based consumer loans dropped to HUF 1.2bn in July from HUF 3.7bn in June and HUF 13.2bn in July 2009.
The indicator for the average cost of borrowing, weighted for the size of loans, was 7.54pc for euro-based home loans and 9.16pc for euro-based consumer loans in July, under the respective 9.99pc and 19.24pc for forint loans.
The value of new Swiss franc-based loans signed with retail clients in July was a negligible HUF 100m.
The value of new forint home loans reached HUF 17.9bn in July, down from HUF 19.9bn in June but practically level with the HUF 17.8bn twelve months earlier. The monthly average for the twelve months to July was HUF 9.6bn.
The average cost of borrowing indicator for the loans was down sharply from 15.06pc a year earlier.
The value of new forint consumer loans was HUF 23.6bn in July, down from HUF 18.1bn in June but over the HUF 18.9bn monthly average for the twelve months to July.
The average cost of borrowing indicator for the loans was down from 28.46pc twelve months earlier.
Hungarian households placed HUF 1,017.3bn into fixed forint deposits in July, up from HUF 974.7bn in June and over the HUF 962.7bn twelve-month monthly average.